WTO Nod For Cheap Drugs To Poor Countries

New Delhi, Aug 30: | Updated: Aug 31 2003, 05:30am hrs
After eight months of uncertainty, the contentious issue of Trips & Public Health has finally been resolved at the World Trade Organisation with the General Council giving the green signal to the agreement on Saturday. The agreement will allow poor countries access to cheap medicines even after the Trips Agreement is in place in January 2005.

Supachai Panitchpakdi
WTO director general Supachai Panitchpakdi called the agreement, which was mandated to be in place by December 31 2002, historic.

The agreement, which is solely aimed at ensuring that poor countries have access to cheap medicines during urgent situations, will also indirectly help the Indian and Brazilian pharmaceutical industry as they would be allowed to export medicines patented by manufacturers in other countries to poor countries during emergencies.

The final piece of the jigsaw has fallen into place, allowing poorer countries to make full use of the flexibilities in the WTOs intellectual property rules in order to deal with the diseases that ravage their people, Mr Supachai said.

The puzzle was incomplete for so long largely due to the US which wanted several restrictions to be imposed on the agreement proposed by the Trips Council chairman on December 16, 2002.

While all members agreed to the proposal, it was only the US which held it up due to intense pressure from its pharmaceutical industry.

The US insisted on limiting the scope and coverage of the agreement.

On Wednesday, the US, India, Brazil, South Africa and Kenya got together and came up with a compromise formula to settle the issue. While the main elements of the December 16 text brought out by the Trips Council was preserved, certain safeguards were inserted to prevent diversion of medicines in developed country markets, which include product differentiation, establishment of insufficient production capacity by importing countries before the Trips Council and involvement of the manufacturers in fixing the royalty for patent holders.

When the new proposal was taken up by the General Council on Thursday, a number of countries including Argentina and Philippines asked for more time to understand the contents of the agreement. After satisfying the queries of all members, the General Council was finally able to give its nod to the proposal on Saturday.

The contentious issue of Trips & Public Health came to the forefront at the Doha ministerial meet in November 2001 where a separate declaration was brought out on the issue recognising the problems the countries with insufficient pharmaceutical manufacturing capacities could face once the Trips Agreement was in place in January 2005. The declaration mandated that a solution should be in place by December 2002.

The Trips Council came out with a draft proposal before the lapse of the deadline, stating that countries with insufficient manufacturing capacities should be allowed to buy patented medicines from non-patent holding manufacturers in other nations during times of urgency and national emergency.

The US said that the proposal was unacceptable. It insisted on limiting the coverage of the diseases to AIDS, malaria and other infectious diseases.

However, due to growing pressure from members and non-government organisations, the US agreed not to insist on restriction of scope and coverage of the agreement provided it was assured that the agreement will not be misused and there would be enough provisions to check diversions.